Boston’s Financial District: An Empty Quarter

The Financial District is hollowing out, and that's a big problem—but it may also be an opportunity.

Mayor Menino, the urban mechanic, is partly to blame for the demise of the city’s core. He has a serious city-building habit and has long seen the South Boston waterfront as a legacy project, in the same way that White once viewed the redevelopment of the Financial District and Quincy Market. Menino helped transform the waterfront’s parking lots into development opportunities by pairing City Hall’s broad zoning powers with tax breaks and, in at least one case, personal recruitment. And as gimmicky and hackneyed as it first sounded, the mayor’s final decree—that this area be called the Innovation District—has given a much-needed purpose to the waterfront.

To his credit, with his waterfront efforts Menino has jump-started a neighborhood that promises to be dynamic, young, and alive—a place where chemists, software engineers, and architects now mingle with former Financial District denizens. But all this waterfront love has made the Financial District feel even older, darker, and closer to death. Adding insult to injury, the city has done little to soften that contrast. Menino famously lured Vertex Pharmaceuticals from Cambridge to Fan Pier with millions in tax incentives, but it’s unlikely that anyone in City Hall ever tried to get a law firm to move to Franklin Street. There’s been sparse advocacy for the area and no firm turnaround plan. There’s no blueprint for reinventing the neighborhood, as there is in South Boston, or even in Allston. The city talks about the need to build more housing units and to bring more retail downtown but doesn’t have any firm targets for how much of each it wants or needs. Its stance toward development is reactive. “I don’t see this as [a situation] where the city does all the planning,” says Peter Meade, the director of the Boston Redevelopment Authority. “It’s going to be done in partnership with builders and developers.” The mayor, he adds, hopes the district will get some spillover from South Boston, but there’s no full-throated advocacy.

It’s one thing to build a whole new neighborhood yourself, but it’s quite another to be a good steward of something someone else built. “One neighborhood shouldn’t flourish at the expense of the other,” argues Greg Selkoe, the CEO of the streetwear retailer Karmaloop, a former Boston Redevelopment Authority staffer, and a vocal critic of the mayor. “The whole idea should be enlarging the pie.”


A lot will have to change for the Financial District to come back to life. And it turns out that change is coming, in spite of City Hall’s reluctance to act. Street-level retail space is now being added to the old Verizon tower at 185 Franklin Street. A handful of restaurants are opening farther up Franklin, not far from the Filene’s crater. Equity Office has recently completed renovations on the lobbies of its many downtown towers, replacing blank concrete walls with windows and opening up the old buildings to the streets around them. As a result, technology companies are beginning to kick the tires again on downtown office space.

As it happens, a little building at 153 Milk Street may foreshadow the other great shift coming for the Financial District. Up until now, Financial District office-to-residential conversions have largely been confined to the bottom of Broad Street, but there’s a huge swath of buildings that could be filled with residents as businesses leak out of the neighborhood. The seven-story Milk Street building predates the neighborhood’s modern office towers and used to house some unremarkable office space. When it wound up in foreclosure, the building’s new owner gutted it and turned it into luxury loft apartments. It’s the same thing the owners of prewar offices in lower Manhattan did when businesses there fled a decade ago. They made money by giving old, dead-end office buildings new purpose, and created a more dynamic live-work neighborhood along the way.

Just look at Downtown Crossing’s comeback, which has been fueled, in part, by Suffolk University’s efforts to create residences in the area. The school transformed outdated offices off Washington Street into dormitory space. The new life on the street has attracted new restaurants, which, in turn, draw new residents. A Chicago developer, for instance, is now converting the building across the street from these former offices into a boutique hotel. “It’s about animating the city,” says George Thrush, the director of Northeastern University’s School of Architecture. “We have those types of buildings in spades,” says Greg Selkoe. “The Financial District and Downtown Crossing should be, and can be, the most exciting part of the city. It’s the densest part. The buildings are really cool. The grid works really well for mixed use.”

But what to do with the Financial District’s enormous floors that once housed all those office workers? Once favored and then abandoned by banks, these massive spaces turn out to be a great layout for tech firms, which prefer sprawling collaborative workrooms over warrens of little offices. The Financial District’s low-rise white elephants lay out just as the old warehouses in Kendall Square and Fort Point do, something the developer Don Chiofaro recently discovered. He quite literally saw the light in the Financial District when he built International Place in the dark corners of downtown two decades ago, aware that the Big Dig would open up views. He may have lost Ropes & Gray to the Pru, but his long-term investment is finally starting to pay off. He just signed eBay’s PayPal unit to a 65,000-square-foot lease on two of the lower floors.

Chiofaro may be the first to establish a tech beachhead in the Financial District, but there will be plenty of landlords scrambling after him, and the first to open a tech incubator downtown (in the mode of Kendall’s Cambridge Innovation Center) is going to make a killing. Chiofaro’s PayPal deal is a watershed, says Ronald Druker, the president of the Druker Company, which owns about 700,000 square feet in Downtown Crossing and the Financial District. “People are looking at the Financial District who weren’t before,” Druker says. He sees larger companies filling up the fat bases of downtown towers, and smaller firms streaming into the neighborhood’s older mid-rise buildings. Druker owns a loft building on Kingston Street, at the edge of Chinatown, that he has been filling with companies priced out of the Innovation District and Kendall Square.


Cities thrive by reinventing themselves. The ones that can’t change shrivel up and fade away. Boston’s biggest success stories involve repurposing centers of long-dead commerce. Tech is exploding in a section of South Boston that was once devoted to shipping and handling wool. South Boston’s tech cluster is modeled after the one across the river, in Kendall Square, where the MIT community spun off new technologies in abandoned brick-and-beam industrial buildings. The developers behind Downtown Crossing’s current building boom have taken advantage of opportunities created by the failure of the neighborhood as a shopping center. So let’s start thinking about what opportunities the evolution of the Financial District presents.

The elements of a turnaround aren’t foreign to our city. They’re in Kendall Square, where a few new restaurants and bars quickly revived a once-dark business district. They’re in Fort Point, where a glut of cheap loft space fueled a boom in tech businesses. And they’re found around the base of the Prudential Center, where new retail and residential development took a building that stood at arm’s length from the city and tied it back into the street grid.

In the Financial District, the buildings crying out for reconstruction once belonged to banks, not factories or railyards. Why should we care? Cities feed off vibrant downtowns, and cities that matter have downtowns that matter. Downtown rot metastasizes: Whether it’s in Detroit or the blocks around the pit that was once Filene’s, dark, dysfunctional blocks chase pedestrians away, driving businesses out in the process. Blight spreads, while money chases money. That’s why Kevin White poured his energies into raising the Financial District’s office towers, and why the mess on the former Filene’s site on Washington Street generated howls from Charlestown to Mattapan. A city can’t claim to be world class if it’s hollow at the core.